NEW DELHI: The Directorate of Enforcement (ED) has arrested Viresh Gangaram Joshi, the former fund manager of Axis Mutual Fund, in connection with a multi-crore front-running scam that allegedly defrauded investors between 2018 and 2021.
A special Prevention of Money Laundering Act (PMLA) court has sent Mr. Joshi, who was taken into custody on Saturday, to ED custody till August 8, the agency said.
The ED's investigation, initiated based on a December 2024 FIR from Mumbai Police, alleges that Joshi exploited his position to engage in "front-running," an illegal practice where an individual uses unethical and illegal practice in the securities market in which brokers or traders execute orders for their own benefit using advance knowledge of pending client orders.
The arrest follows widespread search operations conducted on August 1st and 2nd, 2025, across multiple cities, including Delhi, Mumbai, Gurugram, and Kolkata.
According to the ED, Joshi allegedly used a trading terminal in Dubai and a network of "mule trading accounts" to execute these illicit trades, cheating investors of Axis Mutual Fund, which manages assets worth over Rs 2 lakh crore.
Initial findings from the ED's probe reveal that the total proceeds of crime generated by Joshi and other traders and brokers involved in the scheme could exceed Rs 200 crore. The investigation is ongoing, and the investigating agency believes the total amount could be significantly higher. These illicit gains were allegedly funnelled through a complex web of shell entities and bank accounts linked to the accused and their family members.
During the recent search operations, the ED successfully froze assets worth Rs 17.4 crore, including shares, mutual funds, and bank balances.